Baltic Dry Index. 2385 +62 Brent Crude 66.77
Spot Gold 1777
To me, a wise and humane policy is occasionally to let inflation rise even when inflation is running above target.
Janet Yellen
Wall Street ends week positively; S&P 500, Dow hit record highs
Dogecoin started out as a joke. Now it’s a top 10 digital currency worth $40 billion.
The cryptocurrency is based on the “Doge” meme, which rose to popularity in late 2013. The meme portrays a Shiba Inu dog alongside nonsensical phrases in multicolored, Comic Sans-font text.
Created in 2013 by software engineers Billy Markus and Jackson Palmer, dogecoin was intended to be used as a faster but “fun” alternative to bitcoin. It has since found a growing community online.
And now, defying all odds, dogecoin has a total market value of more than $40 billion, according to crypto market data site CoinGecko, adding over $20 billion in the last 24 hours. The digital token reached an all-time high of 32 cents Friday morning, more than doubling in price from a day ago.
It’s not the first time dogecoin has seen a wild climb. Like many cryptocurrencies, it has a tendency for volatile swings in price. In 2018, dogecoin’s price began rising in tandem with other popular digital currencies. It’s been fairly off the radar since then. But earlier this year, dogecoin skyrocketed on the back of enthusiasm from a Reddit group called SatoshiStreetBets.
Similar to the subreddit WallStreetBets, which helped fuel a rally in GameStop shares at the start of 2021, SatoshiStreetBets aims to pump up the prices of cryptocurrencies.
Dogecoin has been climbing again in the past week, hitting 10 cents a coin for the first time on Wednesday. It’s risen by a whopping 400% in the last seven days.
On Friday, a Reddit user posted a picture of their dogecoin holdings on the Robinhood investing app.
“Hey guys I just became a Dogecoin millionaire,” the user said, showing a balance of $1,081,441.29 in their account.
For one, there’s the Coinbase listing. The most popular U.S. virtual currency exchange went public on Wednesday, briefly hitting a $100 billion market cap in a landmark moment for cryptocurrencies.
The excitement around Coinbase’s debut led to a surge in the prices of bitcoin and ether. Bitcoin hit a record high of more than $64,000 on Thursday, while ether briefly topped $2,500 for the first time Friday morning. Dogecoin has been no exception to the frenzied interest in these digital assets.
I do not think it is an exaggeration to say history is largely a history of inflation, usually inflations engineered by governments for the gain of governments.
Friedrich August von Hayek
Inflation Watch.
What Drives Inflation
There are various factors that can drive prices or inflation in an economy. Typically, inflation results from an increase in production costs or an increase in demand for products and services.
Cost-Push Inflation
Cost-push inflation occurs when prices increase due to increases in production costs, such as raw materials and wages. The demand for goods is unchanged while the supply of goods declines due to the higher costs of production. As a result, the added costs of production are passed onto consumers in the form of higher prices for the finished goods.
One of the signs of possible cost-push inflation can be seen in rising commodity prices such as oil and metals since they're major production inputs. For example, if the price of copper rises, companies that use copper to make their products might increase the prices of their goods. If the demand for the product is independent of the demand for copper, the business will pass on the higher costs of raw materials to consumers. The result is higher prices for consumers without any change in demand for the products consumed.
Wages also affect the cost of production and are typically the single biggest expense for businesses. When the economy is performing well, and the unemployment rate is low, shortages in labor or workers can occur. Companies, in turn, increase wages to attract qualified candidates, causing production costs to rise for the company. If the company raises prices due to the rise in employee wages, cost-plus inflation occurs.
Natural disasters can also drive prices higher. For example, if a hurricane destroys a crop such as corn, prices can rise across the economy since corn is used in many products.
Demand-Pull Inflation
Demand-pull inflation can be caused by strong consumer demand for a product or service. When there's a surge in demand for goods across an economy, prices increase, and the result is demand-pull inflation. Consumer confidence tends to be high when unemployment is low, and wages are rising—leading to more spending. Economic expansion has a direct impact on the level of consumer spending in an economy, which can lead to a high demand for products and services.
As the demand for a particular good or service increases, the available supply decreases. When fewer items are available, consumers are willing to pay more to obtain the item—as outlined in the economic principle of supply and demand. The result is higher prices due to demand-pull inflation.
Companies also play a role in inflation, especially if they manufacture popular products. A company can raise prices simply because consumers are willing to pay the increased amount. Corporations also raise prices freely when the item for sale is something consumers need for everyday existence, such as oil and gas. However, it's the demand from consumers that provides the corporations with the leverage to raise prices.
The Housing Market
The housing market, for example, has seen its ups and downs over the years. If homes are in demand because the economy is experiencing an expansion, home prices will rise. The demand also impacts ancillary products and services that support the housing industry. Construction products such as lumber and steel, as well as the nails and rivets used in homes, might all see increases in demand resulting from higher demand for homes.
Expansionary Fiscal Policy
Expansionary fiscal policy by governments can increase the amount of discretionary income for both businesses and consumers. If a government cuts taxes, businesses may spend it on capital improvements, employee compensation, or new hiring. Consumers may purchase more goods as well. The government could also stimulate the economy by increasing spending on infrastructure projects. The result could be an increase in demand for goods and services, leading to price increases.
Expansionary monetary policy by central banks can lower interest rates. Central banks like the Federal Reserve can lower the cost for banks to lend, which allows banks to lend more money to businesses and consumers. The increase in money available throughout the economy leads to more spending and demand for goods and services.
More
https://www.investopedia.com/ask/answers/111314/what-causes-inflation-and-does-anyone-gain-it.asp
U.S. Housing Market Is Nearly 4 Million Homes Short of Buyer Demand
Freddie Mac says gap has widened significantly in past two years as builders struggle to keep up
April 15, 2021 7:00 am ET
The U.S. housing market is 3.8 million single-family homes short of what is needed to meet the country’s demand, according to a new analysis by mortgage-finance company Freddie Mac.
The estimate represents a 52% rise in the nation’s home shortage compared with 2018, the first time Freddie Mac quantified the shortfall.
The figures underscore the severity of the housing deficit, which is a major factor fueling the current red-hot housing market. The shortage is especially acute for entry-level homes, which makes it more expensive for first-time home buyers to enter the market, said Sam Khater, chief economist at Freddie Mac.
“We should have almost four million more housing units if we had kept up with demand the last few years,” Mr. Khater said. “This is what you get when you underbuild for 10 years.”
Freddie Mac reached its shortage figure by assessing the amount of single-family home building needed to match demand from household formation, second-home purchases and replacements of damaged or aging U.S. homes, and comparing that with the pace of construction.
The supply shortage poses an obstacle to U.S. economic growth, by pushing up housing prices and making it difficult for first-time buyers to enter the market and build wealth, Freddie Mac said.
Home-building activity has been subdued since the 2007-09 recession, when many builders went out of business. While builders have increased activity in the past year, they are hampered by shortages of labor, materials and developed land. Many builders are pacing their home sales to make sure they don’t sell more homes than they can build.
More
There are only three ways to meet the unpaid bills of a nation. The first is taxation. The second is repudiation. The third is inflation.
Herbert Hoover
Covid-19 Corner
This section will continue until it becomes unneeded.
WHO chief says COVID-19 infection rate approaching highest of pandemic so far
by Reuters Friday, 16 April 2021 08:38 GMT
GENEVA, April 16 (Reuters) - The number of new COVID-19 cases per week has nearly doubled globally over the past two months, approaching the highest rate seen so far during the pandemic, the head of the World Health Organization (WHO) said on Friday.
"Cases and deaths are continuing to increase at worrying rates," Tedros Adhanom Ghebreyesus said in a briefing focused on Papua New Guinea (PNG) and the western Pacific region.
He said he was very worried about the potential for a much larger epidemic in PNG, and it was vital the country received more COVID-19 vaccines as soon as possible.
PNG has now reported more than 9,300 COVID-19 cases and 82 deaths. "While these numbers are still smaller than other countries, the increase is sharp and WHO is very concerned about the potential for a much larger epidemic," Tedros said.
PNG health minister Jelta Wong said there was on ongoing challenge in the country to get people wearing masks and disbelief about the disease itself, which would complicate efforts to role out vaccines.
WHO officials said three emergency medical teams had arrived in PNG this week from Australia, the United States and Germany.
https://news.trust.org/item/20210416071348-1n3ui
COVID-19 is much deadlier in Brazil than India and no one knows why
By Chris Kay and Andre Romani
Facing a sudden surge in coronavirus infections, India is once again home to the world’s second-largest outbreak, overtaking Brazil after the latter moved ahead in March. But behind the bleak statistical jockeying is an epidemiological enigma over why the Latin American country has been far more devastated by the pathogen.
When it comes to the scale of infections, the two nations are similarly matched, with cases hovering near 14 million and hospitals from Mumbai to Sao Paulo under increasing pressure as admissions continue to rise. But it’s the divergence in fatalities that has scientists puzzled. Brazil, home to almost 214 million, has seen more than 361,800 people die from COVID-19, more than double the number of deaths in India, which has a far greater population of 1.4 billion.
While deaths in India have started climbing and threaten to get worse, the macro-level disparity remains and is emblematic of different ways in which the pandemic is playing out across regions. Experts say this needs to be better understood and decoded, to contain this global outbreak as well as avoid future public health crises.
COVID-19 death ratios in South Asia, including India, are consistently lower than global averages, just as those in Latin America are consistently higher, forcing virologists to offer a number of theories as to why Covid has cut a more deadly swathe from Brazil to Argentina.
“We’re not comparing apples to apples here, we’re comparing apples to oranges,” said Bhramar Mukherjee, the biostatistics chair at University of Michigan’s School of Public Health. For now, both countries present an “intriguing puzzle — an epidemiological mystery that needs a Sherlock Holmes or Miss Marple in action.”
Brazil has been hit by multiple waves killing an alarming number of its young and it reported a record one-day jump of 4,000 COVID-19-related deaths last week. Meanwhile, India’s daily surge in casualties have been around 1,000 and well below that last week. Deaths in the Asian country as a percentage of confirmed cases is 1.2 versus 2.6 in Brazil, data compiled by Bloomberg show.
Multiple factors could be at play in the fatality gap, including the differences in mean age — 26 years in India to Brazil’s 33.5.
Experts have long criticized India’s broader death statistics, particularly in its rural hinterlands. Before the pandemic about one in five fatalities were not reported at all, according to Mukherjee. But that doesn’t explain why Brazil’s death rate is higher than aging Western nations that have also been hard hit by the pandemic.
More
Pfizer CEO says third Covid vaccine dose likely needed within 12 months
Published Thu, Apr 15 2021 1:23 PM EDT Updated Thu, Apr 15 2021 3:13 PM EDT
- Pfizer CEO Albert Bourla said people will “likely” need a third dose of a Covid-19 vaccine within 12 months of getting fully vaccinated.
- He also said it’s possible people will need to get vaccinated against the coronavirus annually.
Pfizer CEO Albert Bourla said people will “likely” need a booster dose of a Covid-19 vaccine within 12 months of getting fully vaccinated. His comments were made public Thursday but were taped April 1.
Bourla said it’s possible people will need to get vaccinated against the coronavirus annually.
“A likely scenario is that there will be likely a need for a third dose, somewhere between six and 12 months and then from there, there will be an annual revaccination, but all of that needs to be confirmed. And again, the variants will play a key role,” he told CNBC’s Bertha Coombs during an event with CVS Health.
“It is extremely important to suppress the pool of people that can be susceptible to the virus,” Bourla said.
The comment comes after Johnson & Johnson CEO Alex Gorsky told CNBC in February that people may need to get vaccinated against Covid-19 annually, just like seasonal flu shots.
Researchers still don’t know how long protection against the virus lasts once someone has been fully vaccinated.
Pfizer said earlier this month that its Covid-19 vaccine was more than 91% effective at protecting against the coronavirus and more than 95% effective against severe disease up to six months after the second dose. Moderna’s vaccine, which uses technology similar to Pfizer’s, was also shown to be highly effective at six months.
Pfizer’s data was based on more than 12,000 vaccinated participants. However, researchers say more data is still needed to determine whether protection lasts after six months.
More
Next, some very useful vaccine links kindly sent along from a LIR reader in Canada. The links come from a most informative update from Stanford Hospital in California.
World Health Organization - Landscape of COVID-19 candidate vaccines. https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
NY Times Coronavirus Vaccine Tracker. https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Stanford Website. https://racetoacure.stanford.edu/clinical-trials/132
FDA information. https://www.fda.gov/media/139638/download
Regulatory Focus COVID-19 vaccine tracker. https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some more useful Covid links.
Johns Hopkins Coronavirus resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
The Spectator Covid-19 data tracker (UK)
https://data.spectator.co.uk/city/national
Technology Update.
With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported. Is converting sunlight to usable cheap AC or DC energy mankind’s future from the 21st century onwards.
Entropy measurements reveal exotic effect in 'magic-angle' graphene
Researchers discover a surprising phase transition in twisted bilayer graphene
Date: April 7, 2021
Source: Weizmann Institute of Science
Summary: Most materials go from being solids to liquids when they are heated. One rare counter-example is helium-3, which can solidify upon heating. This counterintuitive and exotic effect, known as the Pomeranchuk effect, may now have found its electronic analogue in a material known as magic-angle graphene, say researchers.
This counterintuitive and exotic effect, known as the Pomeranchuk effect, may now have found its electronic analogue in a material known as magic-angle graphene, says a team of researchers from the Weizmann Institute of Science led by Prof. Shahal Ilani, in collaboration with Prof. Pablo Jarillo-Herrero's group at the Massachusetts Institute of Technology (MIT).
This result, published today in Nature, comes thanks to the first ever measurement of electronic entropy in an atomically-thin two dimensional material. "Entropy describes the level of disorder in a material and determines which of its phases is stable at different temperatures," explains Ilani. "Our team set up to measure the electronic entropy in magic angle graphene to resolve some of its outstanding mysteries, but discovered another surprise".
Giant magnetic entropy
----"When we performed the measurements at high magnetic fields, the entropy looked absolutely normal, following the expected behaviour of a conventional (Fermi) liquid of electrons, which is the most standard state in which electrons exist at low temperatures. Surprisingly, however, at zero magnetic field, the electrons exhibited giant excess entropy, whose presence was very mysterious." says Ilani. This giant entropy emerged when the number of electrons in the system was about one per each site of the artificial "superlattice" formed in magic angle graphene.
----"This new result challenges our understanding of magic angle graphene," says Berg. "We imagined that the phases in this material were simple - either conducting or insulating, and expected that at such low temperatures, all the electronic fluctuations are frozen out. This turns out not to be the case, as the giant magnetic entropy shows".
"The new findings will provide fresh insights into the physics of strongly correlated electron systems and perhaps even help explain how such fluctuating spins affect superconductivity," he adds.
The researchers acknowledge that they do not yet know how to explain the Pomeranchuk effect in magic angle graphene. Is it exactly as in helium-3 in that the electrons in the solid-like phase remain at a great distance from each other, allowing their magnetic moments to stay completely free? "We are not sure," admits Ilani, "since the phase we have observed has a 'spit personality' - some of its properties are associated with itinerant electrons while others can only be explained by thinking of the electrons as being localized on a lattice".
This weekend’s musical diversion. Vivaldi’s concerto for 4 violins. Bach liked it so much he took it and adapted it for 4 harpsicords. Later someone adapted it for 4 grand pianos. Since it’s easier to get 4 violinists on a stage than 4 grand pianos, this is probably one of the rare times it will be attempted. Approx.10 minutes.
Bach-Vivaldi/Concerto for 4 Pianos/MultiPiano Ensemble
.https://www.youtube.com/watch?v=7OwQOb6bd1M
Vivaldi’s original version. Also,
unsurprisingly, approx. 10 minutes. Complete with excitable conductor.
Vivaldi: Concerto in B minor RV.580, for four violins
https://www.youtube.com/watch?v=kO6CqW3imbo
This weekend’s helpful if useless trivia, how did the USA states get their names. Approx. 22 minutes.
How Did Each U.S. State Get Its Name?
https://www.youtube.com/watch?v=I2Q7RJmvkcE
This weekend’s maths masterclass. The Ulam square spiral. Approx. 9 minutes.
Extending Ulam Beyond Primes
https://www.youtube.com/watch?v=inrYsAusfPg
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
Alan Greenspan
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